Election Update – October 2017

Legal Update – Election 2017 – What now for employment law?

The outgoing National government made significant changes to the original Employment Relations Act 2000 (ERA), as well as implementing amendments to the Holidays Act 2003, and passing the new Health and Safety at Work Act 2015.

But, what happens now that we are about to have a Labour-led government?  Labour is seeking change because “Weak employment law has created avenues for some businesses to undercut good employers by driving down wages and minimising costs”[1].  Some stated intended change is as follows:

  • First 100 days[2]:
    • “Restore fairness rights for employees by replacing National’s 90 day ‘fire at will’ law with a fast, fair, and simple system”;
    • “Restore reinstatement as the primary remedy when a worker has been unjustifiably dismissed”;
    • “Restore the right to rest and meal breaks at work”;
    • “Restore protections for vulnerable workers in cases where the sale or transfer of business is contemplated, or where outsourcing of jobs is proposed”;
    • “Ensure that New Zealand employment law applies to everyone working in New Zealand, including foreign workers working for foreign companies”;
    • “Increase the minimum wage to $16.50 an hour and base future increases on the real cost of living for people on low incomes. This includes working towards a minimum wage equal to two-thirds of the average wage as economic conditions allow”;
    • Increasing paid parental leave: “The policy will be phased in over three years: 22 weeks from 2018 and 26 weeks in 2020”[3];
    • Reversing changes made to collective bargaining and collective agreements by the National government.
  • Labour’s “workplace relations package” includes the following[4]:
    • “Introducing Fair Pay Agreements that set fair, basic employment conditions across an industry based on the employment standards that apply in that industry”;
    • “Promoting the Living Wage by paying it to all workers in the core public service, and extending it to contractors over time [this is currently said to be $20.20 per hour[5]]”;
    • “Doubling the number of Labour Inspectors”;
    • “Implement the changes to the Equal Pay Act as set out in the report from the Joint Working Group on Pay Equity Principles to give all women in female-dominated workforces access to collective bargaining and court processes to settle their claims”.
  • Within its first 12 months Labour also intends to[6]:
    • “Begin consultation on improving minimum redundancy protection for workers affected by restructuring, giving regard to the recommendations of the 2008 Ministerial Advisory Group report on redundancy and restructuring”;
    • “Introduce statutory support and legal rights for ‘dependent contractors’ who are effectively workers under the control of an employer, but who do not receive the legal protections that are currently provided to employees under the law”;
    • “Investigate options for ensuring that people who work over 40 hours a week receive adequate remuneration”;
    • “Extend the right for workers to elect a health and safety representative from amongst their own to all workplaces, regardless of size or industry”;
    • “Abolish youth rates”.
  • And on immigration and employment, Labour intends to[7]: “Ensure that businesses are able to get genuinely skilled migrants when they need them… This will include introducing an Exceptional Skills Visa for highly skilled or talented people and introducing a KiwiBuild Visa for residential construction firms who train a local when they hire a worker from overseas… Strengthen the Labour Market Test for work visas so they are not being used for jobs Kiwis can do, and make our skills shortage lists more regional so migrants coming in under them can only live and work in areas where there is a genuine skills shortage”.

What about New Zealand First?  Labour’s plans are likely to have been affected by its as yet unseen coalition agreement with New Zealand First, whose stated “…vision is of a nation made up of well educated, determined, healthy, and innovative people, with an expanding business programme geared around exports, regional development, job growth and harnessing the natural attributes of our country.”[8]

Under that head, New Zealand First’s stated policy is[9]:

“RAISE THE MINIMUM WAGE

  • Increase the minimum wage to $20 per hour over three years starting in 2018 (with tax assistance for employers).
  • Remove secondary tax for workers with more than one job.
  • Abolish the ‘starting out wage’ for young people.
  • Set Minimum Redundancy provisions based on twice the normal contractual notice period up to a maximum of 13 weeks.
  • Amend the Companies Act so that wages and salary, including holiday pay, have equal priority with Secured Creditors.

PATERNITY AND MATERNITY LEAVE

  • Introduce paid paternal leave of two weeks rising to four weeks.
  • Support increasing paid maternity leave to 26-weeks.

BETTER LABOUR RELATIONS

  • Review and amend employment laws to ensure that casualisation employment practices are fair and just with a review of short term employment contracts.
  • Train New Zealanders in areas of skill shortages, instead of actively recruiting offshore.
  • Put New Zealanders first for jobs by sensible immigration policies.
  • Pay the Job Seekers Benefit to approved employers when taking on an apprentice.
  • Paid internship programme to provide work experience.
  • Introduce literacy and numeracy skills package for workers.
  • Introduce the Ministry of Social Development funded and NZ Defence Force operated Youth Enterprise and Training Initiative to offer trade training to students not suited to conventional education.
  • Establish workforce planning, career advice and competitive course entry for post-secondary education.
  • Require transparency when public service salaries exceed accepted public service bands.

BETTER HEALTH & SAFETY

  • Amend the Health and Safety at Work Act 2015 to remove its bureaucratic excesses.”

There is much there, but at the same time, little detail.  Like Labour, New Zealand First’s ‘wish list’ will also have been subject to its coalition agreement – albeit there also seems to be quite a lot in common with what Labour intends to do.

And what about Green Party, from outside cabinet?[10]  Its policies are based on its “vision” that[11]:

  • “People have the opportunity to participate in meaningful work that reflects their individual and cultural needs and preferences”.
  • “Workplaces are environmentally responsible, innovative, family friendly, safe from discrimination and prejudice, and promote lifelong learning opportunities and skills development”.
  • “Employers, working people and their unions enjoy equitable and beneficial relationships with each other”.
  • “Working people are paid a living wage and decent working conditions in secure, empowering jobs”.

Its “Key Principles” concerning the above are[12]:

“1.  In recognition of Te Tiriti o Waitangi, the Green Party supports equitable access for Māori to secure employment, decent wages and the organisation of Māori into and within trade unions.

2.  The Green Party supports the realisation of a sustainable working life based on the three pillars of economic viability, environmental protection and social responsibility (the triple bottom line).

3.  Working people, employers and unions should be involved in making decisions about issues in their workplaces, the economy, and the environment.

4.  Workplace democracy and collective organisation are essential to address the inherent potential for inequality of power between employers and employees.

5.  All working people deserve justice, and protection under the law.

6.  Workplaces should be safe, environmentally healthy and free from discrimination.

7.  Working people should be paid a living wage that accurately reflects the range of economic pressures they and their families face.

8.  Working people have a right to pay and employment equity.

9.  The state sector should provide a sound model of good employer practice”.

Again, there does appear to be common ground, but the extent to which the Green Party can influence policy in this area is uncertain given its position outside cabinet.

For now, it seems fairly clear that in the short (i.e. in the “first 100 days”) to medium term, there will be change.  However, the specific nature of that change is unclear, including because of the as yet uncertain content of the coalition agreement that has been reached, and the exact makeup of cabinet and positions outside cabinet.  So, watch this space…

For advice from our employment law specialists either call us on 04 801 5427, or contact us via email:

Paul McBride (Partner) – paul@mdjlaw.co.nz 
Geoff Davenport (Partner) – geoff@mdjlaw.co.nz 
Tanya Kennedy (Senior Associate) – tanya@mdjlaw.co.nz 
Guido Ballara (Senior Associate) – guido@mdjlaw.co.nz 
Frances Lear (Senior Associate) – frances@mdjlaw.co.nz

Disclaimer – this newsletter is necessarily brief and general in nature. You should seek professional legal advice before taking any action in relation to any matter dealt with in this newsletter. © McBride Davenport James.

[1] http://www.labour.org.nz/workplacerelations (last accessed 20 October 2017)
[2] http://www.labour.org.nz/workplace_relations_policy (last accessed 20 October 2017)
[3] http://www.labour.org.nz/paidparentalleave (last accessed 20 October 2017)
[4] http://www.labour.org.nz/workplacerelations (last accessed 20 October 2017)
[5] http://www.livingwage.org.nz/2017_living_wage_rate_20_20 (last accessed 20 October 2017)
[6] http://www.labour.org.nz/workplace_relations_policy (last accessed 20 October 2017)
[7] http://www.labour.org.nz/immigration (last accessed 20 October 2017)
[8] http://www.newzealandfirst.org.nz/ (last accessed 20 October 2017)
[9] http://www.newzealandfirst.org.nz/ (last accessed 20 October 2017)
[10] The Green Party has agreed to provide confidence and supply, albeit it is also understood to be receiving ministerial portfolios outside cabinet: https://www.greens.org.nz/news/press-release/greens-join-government-change (last accessed 20 October 2017)
[11] https://www.greens.org.nz/sites/default/files/industrialrelations_20170520_0.pdf (last accessed 20 October 2017)
[12] https://www.greens.org.nz/sites/default/files/industrialrelations_20170520_0.pdf (last accessed 20 October 2017)

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